US President Donald Trump has announced a 25% tariff on all imported steel and aluminum, a decision that comes amid PM Narendra Modi’s US visit. Speaking en route to the Super Bowl in New Orleans, Trump stated that the tariff will apply to all steel and aluminum entering the US, with an official announcement on Monday.
Impact on India-US Trade
In 2023, India exported $4 billion worth of steel and $1.1 billion worth of aluminum to the US. Steel and aluminum trade has been a contentious issue between the two nations, with the US accusing India of subsidizing exports. During PM Modi’s 2023 Washington visit, both countries agreed to resolve six WTO disputes related to metal tariffs. However, in October 2023, the US imposed tariffs of up to 39.5% on certain categories of aluminum imports.
Reciprocal Tariff Policy
Trump emphasized a reciprocal tariff strategy, stating, “If they tax us, we will tax them.” This suggests that countries imposing tariffs on US goods will face similar tariffs on their exports to the US.
Previous Tariff Policies
In January 2024, during Joe Biden’s final days in office, the waiver on Trump-era tariffs (10-25%) was agreed upon. In return, India lowered tariffs on apples, walnuts, and almonds.
The new 25% tariff on steel and aluminum could present fresh challenges for Indian exporters, impacting trade relations between the two nations.
